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Develop Multiple Regression Model in Excel

Data Set to be used:
Lottery Education Age Children Income
5 15 50 2 41
7 10 26 0 22
0 13 40 3 24
10 9 46 2 20
5 14 40 3 32
5 15 39 2 42
3 8 36 3 18
0 16 44 1 47
0 20 47 4 85
6 10 52 1 23
0 18 51 2 61
0 17 41 2 70
12 9 42 2 22
7 12 53 1 27
11 9 72 1 25
2 16 38 2 43
11 12 41 5 34
2 14 50 3 53
7 9 41 3 20
0 16 52 0 71
10 9 41 2 16
8 10 45 3 19
1 16 58 0 64
11 11 53 0 25
7 14 61 2 31
3 17 30 1 42
5 17 40 0 50
9 11 73 3 31
5 15 43 4 35
10 9 49 3 18
7 10 50 0 26
10 10 27 1 23
1 17 46 3 39
4 14 47 1 22
7 14 47 3 31
8 12 28 1 29
8 14 26 1 29
3 17 32 2 30
5 16 42 5 21
3 11 53 1 26
0 17 46 1 66
8 14 33 3 29
3 16 52 0 48
8 11 58 3 20
0 18 28 3 80
7 10 53 2 31
7 14 43 1 26
0 16 49 2 36
7 9 38 1 26
9 10 44 0 21
8 9 32 1 24
0 12 44 3 18
7 10 52 0 28
0 16 40 2 42
8 11 53 6 21
7 8 43 2 28
8 17 23 0 27
8 12 21 0 34
7 9 50 3 28
9 12 46 1 30
5 7 82 0 23
0 20 45 3 95
0 11 23 0 22
11 9 40 3 27
8 12 36 3 23
0 10 42 1 29
9 7 36 0 25
7 14 58 3 25
0 16 36 0 28
8 9 37 2 25
6 10 53 2 27
7 17 42 2 39
0 19 50 4 63
8 11 33 0 28
8 11 27 3 29
0 16 30 2 34
7 11 40 2 19
6 13 32 2 22
8 11 69 2 17
0 17 24 0 34
1 17 32 2 44
6 8 21 0 28
0 19 31 2 53
10 11 53 1 16
9 14 43 1 22
5 14 39 1 27
0 7 37 2 22
10 8 57 1 23
10 10 31 1 24
13 8 71 0 11
6 15 59 3 50
7 15 33 3 37
3 11 33 3 24
0 11 41 3 30
5 12 53 3 21
0 16 35 1 53
0 17 54 0 31
10 9 55 2 29
6 16 24 0 36
11 12 56 3 27

Here is the problem:

Lotteries have become important sources of revenue for governments. Many people have criticized lotteries, however, referring to them as a tax on the poor and uneducated. In an examination of the issue, a random sample of 100 adults was asked how much they spend on lottery tickets and was interviewed about various socioeconomic variables. The purpose of this study is to test the following beliefs:

(1) Relatively uneducated spend more on lotteries than do relative educated people.

(2) Older people buy more lottery tickets than younger people.

(3) People with more children spend more on lottery tickets than people with fewer children.

(4) Relatively poor people spend a greater proportion of their income on lotteries than relatively rich people.

The following data was recorded.

a. amount spent on lottery tickets as a percentage of household income.

b. Number of years of education

c. Age

d. Number of children

e. Personal income (in thousands of dollars)

Develop the multiple regression equation.
Is the model valid?
Test each of the beliefs. What conclusions can you draw?

Solution Summary

The solution provides step by step method for the calculation of multiple regression model. Formula for the calculation and Interpretations of the results are also included.

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